England’s ‘dysfunctional’ childcare system pushes women out of work and is harming birth rate

England’s “dysfunctional” childcare system is falling behind other countries, according to a damning new study.

The research, by the Fawcett Society, a leading gender equality charity, warned our childcare system lacks a long-term strategy and requires urgent “wholesale reform”.

Researchers looked at childcare provision in France, Ireland, Australia, Estonia and Canada – all nations where the government has recently or is currently enacting major policies on early years provision.

The report notes both the Covid crisis and the cost of living crisis compounded existing problems with the childcare system, arguing the current system is failing in terms of quality of childcare, how affordable it is and the levels of public spending invested.

Researchers warn problems with childcare are pushing women out of work and entrenching the gender pay gap, with children, parents, and childcare services being failed in the process. Unless the childcare system is reformed, birth rates are likely to carry on decreasing, the study suggested.

It comes as the first part of the chancellor’s £4bn extension of free childcare – an attempt to win over voters in the lead-up to the election later in the year – came into force at the beginning of the month.

Under the new policy, eligible working parents of two-year-olds have been told they may claim 15 hours a week of free childcare for 38 weeks per year from April onwards.

From September 2025, working parents who have children under the age of five will be able to claim 30 hours of free childcare for 38 weeks per year.

Alesha De-Freitas, one of the report’s authors, told The Independent: “England’s government-run childcare plan is less transparent than other countries. So far the government has made plans about overhauling the childcare system without consulting childcare providers and experts first and without thinking holistically and sustainably about how the plans will work.

“There is a greater awareness in other countries that some children – particularly those from disadvantaged backgrounds – benefit from more high-quality childcare, not just the children of working parents. There is greater recognition of the potential of childcare to tackle social mobility.”

Ms De-Freitas, head of policy at the Fawcett Society, argued discussions around childcare in England are very narrow and focused on affordability whereas the other countries take a broader look at what constitutes good-quality childcare more centred on the needs of the child.

“There needs to be a long-term plan – at least 10 years – of how we develop childcare. Ireland is a really good example of a country which put together a plan and that plan is a public plan that everyone can see.”

She called for money to be given directly to nurseries rather than the current model, which is directly centred on individual children’s places.

“This means you are not just giving money to nurseries in areas where they have richer parents and you can make sure there is capacity in areas across the country,” she said.

“If there are no working parents in an area, they are not going to get the subsidies. Then there isn’t the economic incentive for those nurseries to exist, so that means less childcare provision in poorer areas.”

It comes after The Independent revealed that thousands of nurseries had shut their doors amid staffing shortages, sparking fears that the government’s promise to expand free childcare was “doomed to failure”, in the words of Neil Leitch, chief executive of national education charity and service provider the Early Years Alliance.

The new study suggested evidence from Australia has found offering subsidies to parents in work leads to children who most need access to childcare being blocked from accessing it. Researchers called for the government’s free childcare provision to be overhauled so it is open to all children rather than only those of working parents.

Jemima Olchawski, chief executive of the Fawcett Society, argued that a “broken” childcare system is not “inevitable” as the nations analysed in their research demonstrate.

“Our childcare is some of the most expensive in the world and it isn’t working,” she said. “Research shows that 85 per cent of mothers struggle to find childcare that fits around their work and one in ten have quit jobs due to childcare pressures. For too long we’ve seen the cracks in our dysfunctional childcare system papered over.”

She added: “As we approach a general election, all parties need to be aware that any credible vision for transforming childcare mustn’t simply offer bolt-ons to a crumbling system.”

Alfie Stirling, director of insight and policy at the Joseph Rowntree Foundation, a charity dedicated to ending poverty in the UK, said: “Our dysfunctional childcare system is not working for families in the here and now.”

A spokesperson for the Department of Education said: “Working parents on universal credit are also eligible for support with childcare costs no matter how many hours they work, up to £1,015 per month for a single child and £1,739 for two children.

“England has some of the highest quality early years provision in the world, with 96 per cent of early years settings rated by Ofsted as good or outstanding as of August 2023 – up from 74 per cent in 2012.”